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Ann Arbor alcohol delivery service still under review by state; local services on 'summer vacation'

Whiskey Wars

The alcohol delivery service Klink -- formerly DrinkDrivers -- is still under review by the Michigan Liquor Control Commission. The company's co-founder said it's taking a "summer vacation" from Ann Arbor deliveries while it expands in Washington, D.C. and beyond, but it will resume Ann Arbor-area deliveries in the coming weeks.
((AP Photo/Mark Humphrey))

The alcohol delivery service formerly known as DrinkDrivers has temporarily halted its operations in Ann Arbor, and the business is still under review by the Michigan Department of Licensing and Regulatory Affairs.

The legality of the business came into question after The Ann Arbor News looked into state legislation regarding the delivery of wine, beer and spirits. Carol Shepard Estill, an investigator with the Michigan Liquor Control Commission, began an informal review of the business in late-April after a story by The Ann Arbor News.

In an April 21 email responding to a question about whether the business complies with state regulations, Estill, a 14-year investigator with the Michigan Liquor Control Commission, said that DrinkDrivers has not been operating within the confines of MLCC Code 436.1403(11), and that the business is not legal in the state. An excerpt from the code states:

"A retailer that holds a specially designated merchant (beer and wine) license in this state...may deliver beer and wine to the home or other designated location of a consumer in this state..." if a series of requirements are met.

The company's business model is set up so it meets all of the requirements of MLCC Code 436.1403(11) for the delivery of beer and wine, Shepard Estill explained, but the state has to determine whether the company's delivery of liquor is permissible.

Jeff Nadel, the co-founder of the alcohol delivery service, said the company recently went through a rebranding process and will now be known as Klink. He said the state's review of the business had nothing to do with his decision to rebrand from DrinkDrivers to Klink.

"The new name is short, memorable, and evocative of the ever-welcome sound of glasses bumping together. Along with this rebrand come great changes in the user experience on our app and website," he said in an email to The Ann Arbor News.

"The rebrand also marks the beginning of an aggressive expansion push for our company. Throughout the coming weeks and months you'll see a whole lot of growth from us. We just had our soft launch in Washington, D.C. — we're covering the majority of the city — and we'll start our marketing push there in the coming week or so. After that, it's on to another city..."

Nadel said that that delivery services in Ann Arbor are on a "summer vacation."

"Because we were able to launch in D.C. with our technology ready to go, we now have to upgrade our legacy systems that are still in place in Michigan. Unfortunately, this means a bit of downtime, but it will result in an even better user experience in just a couple weeks," Nadel said.

As of June 24, the company is still under review by the state, according to a spokeswoman for LARA, and she said there would be no updates for "a couple weeks."

The spokeswoman did not respond to calls and emails about what has been reviewed and what still needs to be reviewed by the state.

"We are absolutely still operational in Ann Arbor and (we're) more excited than ever for what the future holds in Michigan," Nadel said.

Klink allows its customers to use a mobile or web-based app to order alcohol and other items from its state-licensed partner. After placing the order, customers pay for their orders through the application and the licensed dealer delivers the product.

DrinkDrivers doesn't make money directly from the sale of the alcohol. Instead, it charges a $2.87 flat-rate delivery fee regardless of the quantity of alcohol ordered.

The company launched at the University of Central Florida last fall and decided to make Ann Arbor its second launch location, launching here in March 2014.